11 AAC 25.130 - Location differentials
(a) The commissioner will establish location
differentials to
(1) calculate the destination
value of qualified gas at a destination upstream of a first destination market;
or
(2) calculate the destination
value of a gas plant product or component other than methane in a first
destination market if a published price for that gas plant product or component
is not available or is not reliable.
(b) To establish a location differential, the
commissioner will consider
(1) the difference
between a reliable published price for residue gas or a gas plant product in a
market with a reliable published price and the price paid for residue gas, a
gas plant product, or unprocessed gas in the market without a reliable
published price;
(2) the cost of
transportation between the market with a reliable published price and the
market without a reliable published price;
(3) other factors relevant to differences in
value that result from the market location.
(c) The commissioner will give notice of
location differentials established under this section by posting a list on the
department's website. The commissioner may add to, replace, or remove entries
on the list of location differentials by posting a revised list of location
differentials on the department's website at least 15 days before the first day
of a royalty reporting period affected by the action. A location differential
posted by the commissioner to the department's website under this section is
not subject to retroactive change.
(d) If the commissioner is notified in
writing at least three months before a first shipment that a lessee or its
affiliate will transport qualified gas to a destination upstream of a first
destination market, the commissioner will post a location differential for that
destination on the department's website at least 15 days before the first day
of a royalty reporting period affected by the posting.
(e) If the commissioner is not notified in
writing at least three months before a first shipment that a lessee or its
affiliate will transport qualified gas to a destination, and the commissioner
has not posted a location differential for the destination on the department's
website, the destination value and location differential for that destination
may be adjusted by the commissioner based on the criteria for destination value
set out in this chapter and the criteria for location differentials set out in
this section. An adjustment under this subsection is retroactive to the date of
first shipment.
Notes
Authority:AS 38.05.020
AS 38.05.180
AS 43.90.310
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